EV Manufacturer Fisker Filing For Bankruptcy Protection, Plans To Sell Assets
Is This finally the end of Fisker or will it keep staying afloat like it has all this time?
Fisker, the U.S. electric vehicle (EV) maker, has filed for bankruptcy protection not too long ago to restructure amidst financial challenges brought on by the competitive EV market. The company aimed to salvage operations by selling assets after struggling with cash burn from ramping up production of its Ocean SUVs.
In recent years, the EV sector witnessed bankruptcies from firms like Proterra, Lordstown, and Electric Last Mile Solutions due to weak demand, funding difficulties, and supply chain disruptions. Founded by Henrik Fisker, the company faced uncertainty since February, failing to secure a crucial investment from Nissan, which was contingent on a major automaker’s backing.
Moreover, this setback prompted Fisker to explore other financial options. In its Chapter 11 filing, Fisker Group Inc. reported assets between USD500 million to USD1 billion and liabilities from USD100 million to USD500 million. Major creditors listed in the filing included Adobe, Google, and SAP.
Fisker had gone public in late 2020 through a merger valued at USD2.9 billion, raising over USD1 billion, but struggled with operational challenges. Its Ocean SUV, intended to streamline production through an outsourced manufacturing model, faced critical issues highlighted by Consumer Reports, including software glitches and regulatory concerns.
On top of that, despite shifting to a dealership-based sales approach earlier this year, the brand still struggled to sell its inventory of over 5,000 vehicles, delivering less than half of its 2023 production. Henrik Fisker, known for his earlier venture Fisker Automotive, aimed to revolutionise the auto industry with an “asset light model,” similar to Apple’s strategy.
However, setbacks from the 2008 financial crisis and technical issues with the Karma sedan marked his previous attempt. “Today’s announcement doesn’t come as a surprise.” commented Garrett Nelson of CFRA Research, noting the broader challenges faced by EV startups in a fiercely competitive market.
Right from the get go, Fisker was never very successful and it was always floating around and just barely surviving on a global scale and in fact, many people all across the globe have never even heard of the brand. At the end of the day, I hope this restructuring helps the brand finally get out of this weird financial limbo and actually see some success at least.
We got all this from Reuters and their full article is linked here. Thank you Reuters for the information and images.
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